FDI related issues
India of today can be acknowledged as the one of the fastest growing economy in the world and in this current economic status,
indianground.com/ real estate India has emerged as one of the most appealing investment areas for domestic as
well as foreign investors. And this high growth curve in the real estate sector owes some credit to a booming economy and liberalized FDI regime in the real estate sector. The Indian government in March 2005 amended existing norms to allow 100 per cent
indianground.com/real_estate_fdi.aspx Foreign Direct Investments (FDI) India in the construction business. This liberalization act cleared the path for foreign investment to meet the demand into development of th.commercial and residential sectors and has encouraged several large financial firms and private equity funds to launch exclusive funds targeting the real estate sector. The
indianground.com/agents_and_brokers.aspx property dealer India is too taking steps to walk hand in hand with the forest investors t.compile large real estate projects in India.
At the same time, the government has also set up certain guidelines for investors willing to apply in FDI, which have conditions like area, investment options and target fo.completion of a project.
Minimum area
¢In case of development of serviced housing plots, 10 hectares (25 acres) ¢In case of construction-development projects, built-up area of 50,000 sq m. ¢In case of .combination project, any of the above two conditions
Investment
¢Minimum capitalization 1.for wholly owned subsidiaries - US$ 10 million 2.for JV with Indian partners - US$ 5 million, to be brought in within 6 months o.commencement of business ¢Original investment cannot be repatriated before a period of three years fro.completion of capitalization. ¢The investor may exit earlier with prior approval from Foreign Investment Promotion Board (FIPB).
Time frame & rules
¢At least 50 per cent of the project to be developed within five years from the date of obtaining all statutory clearances. ¢ Investor cannot sell undeveloped plots - where roads, water supply, street lighting, drainage, sewerage and other conveniences are not available.
New Face Of FDI
With this change in the government policy on FDI, all real estate india sectors, residential property india.commercial properties india and retail are currently witnessing huge growth in demand. And this has also brought about a conspicuous interest by towards investments in the Indian hospitality sector. One of the most anticipated promises for the Indian real estate sector, which in turn will benefit developments of hotels, has been the entry of Real Estate Mutual Funds (REMFs) or Real Estate Investment Trusts (REITs).
Conclusion
Industry reports suggest the inflow of about US$ 500 million into the real estate sector over the past six months and is expected to rise to a massive $ seven to eight billion over the next 18-30 months.
About The Author
Suraj Kumar Singh is an associate editor to the website Indianground.com. Indianground is dedicated to providing all necessary information on real estate India and India properties, with the latest news and updates to keep you informed on the latest happenings in Real Estate industry. Your feedback an.comments will be highly appreciated at
E-mail kumarsingh.suraj>
E-mail kumarsingh.suraj
